Skyrocketing mobile business results in nearly three-fold profit rise for Alibaba

E-commerce

by CBR Staff Writer| 28 August 2014

A positive outlook ahead of planned IPO.

A month before its initial public offering, Alibaba reported a three-fold rise in its profit for the second quarter of 2014 to $2bn, mainly driven by its mobile business.

During the quarter, the Chinese e-commerce major reported a 46% revenue rise to $2.54bn, compared to 38.7% growth registered during last quarter.

Alibaba generated $395m in mobile revenue during the quarter, which is ten-fold rise from the corresponding quarter last year.

Alibaba currently accounts for about 80% of all online retail sales in China, driven by increasing Internet use and growing middle-class with spending power, which bring its gross merchandise volume $296bn by the year ended 30 June.

Alibaba's IPO filing prompted speculation that it could turn out to be the largest flotation in history, which could touch as high as about $245bn.

"Our current focus is on increasing mobile (gross merchandise volume) and user engagement," Alibaba said in a U.S. regulatory filing on Wednesday.

The company, which is claimed to handle more transactions compared to Amazon and eBay combined, had 279 million active consumers by the end of the latest quarter, up 50% from last Q2.

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